C. Emerging Stronger With Skilled Workers And Innovative Businesses


C. Emerging Stronger With Skilled Workers And Innovative Businesses

  1. C1. I have covered the COVID-19 Resilience Package, which addresses our immediate needs – to safeguard public health, provide support for workers and businesses, and give more help to worst-hit sectors.
  2. C2. The past year’s Budgets and the COVID-19 Resilience Package are about preservation and adaptation – to safeguard lives, jobs, supply chains, and core economic capabilities.
  3. C3. From 2021, our focus will be on Emerging Stronger, Together.
  4. C4. Why is this important? The COVID-19 pandemic has triggered global shifts on the economic, social and political fronts, on a scale arguably greater than the 1929 Great Depression. It has set off new domains for competition and cooperation. It has also accelerated technological advances. To secure our future, we must build new capabilities in our people and businesses, and find new ways to work together effectively. Within and across industries, and beyond our shores.
  5. C5. While the post-COVID-19 global economic landscape is being reshaped and remains uncertain, we can discern the broad contours.
  6. C6. What are some of the key changes that can affect Singapore?
    1. a. First, the speed of technological advances and re-configuration of global supply chains, will reshape competitive advantages.
      1. i. During the 2003 SARS outbreak, by the time vaccines were ready for clinical trials, the virus was already largely contained through public health measures. But the COVID-19 pandemic has been different. Governments, scientists, and industry mobilised to work together at unprecedented speed. COVID-19 vaccines were developed in less than a year, and tests were implemented within weeks to months, in the US, China, Europe and Russia. This collaboration across industries and nations, has been a positive side of the pandemic.
      2. ii. But COVID-19 has also accentuated a US-China-centric technology race, into a global race for technological superiority, and heightened concerns over supply chain resilience. For Singapore, as global supply chains are reconfigured, we must plug ourselves into critical parts of global networks. Businesses will need to transform and digitalise, to plug into the flow of goods and capital.
    2. b. Second, COVID-19 has hit countries and communities unevenly and widened inequalities. The virus respects no borders. The global economy will remain stunted for as long as there are countries that have yet to suppress COVID-19. This is why Singapore is working with like-minded countries through the COVAX facility, to promote global access to the vaccine, and help accelerate the resumption of safe travels.
    3. c. Third, this tiny virus has reminded us of the intricate interdependencies of our ecosystem, and the importance of sustainability and biodiversity. Our human activities have accelerated changes in our environment. We must work together to safeguard this fragile ecosystem for our future generations, and take climate change seriously.
  7. C7. In short, these three changes – the changing competitive landscape, rising inequalities, and importance of sustainability – are all mega-shifts, that will continue to reshape the world. To stay on top of these changes, we must bring all stakeholders together swiftly to respond to and seize the diverse opportunities.
  8. C8. So while last year’s Budgets were tilted towards emergency support in a broad-based way, this year’s Budget will focus on accelerating structural adaptations. In the face of major changes, we must move from just counter-cyclical fiscal and monetary stabilisation policies, to structural economic policies to equip our businesses and workers with deep and future-ready capabilities.
  9. C9. Like many countries, we have devoted significant resources to preserve lives and livelihoods in the face of this pandemic. But what will continue to distinguish Singapore are our investments for the future. We will invest in our people – so they can bounce back and be ready for opportunities that arise; and we will invest in our businesses – so they can innovate, build deep capabilities and seize growth opportunities. Singapore must never stop thinking of the future, even as we respond swiftly to meet current needs. This is how we stay exceptional, and staying exceptional is how we survive.
  10. C10. Over the next three years, I will allocate $24 billion to enable our firms and workers to emerge stronger. The efforts will span several years, but it is crucial that we start today. This builds on the momentum of the transformation push started five years ago, when we launched our Industry Transformation Maps.
  11. C11. In this financial year, I will focus on how we can move decisively to build three enablers for this next phase of transformation, to emerge stronger.
    1. a. First, to grow a vibrant business community, with a strong spirit of innovation and enterprise, deeply connected with Asia and the world.
    2. b. Second, to catalyse a wide range of capital to enable businesses to transform and scale.
    3. c. Third, to create opportunities and redesign jobs, for our people to develop their skills, creativity, and talents. Ultimately, the purpose, the raison d'être of our economic transformation is to grow opportunities for our people to realise their full potential and aspirations.
  12. C12. Let me now elaborate on how we will invest in these three key enablers.

Vibrant Business Sector and Ecosystem for Innovation

  1. C13. As a small, open city-state, Singapore has maintained the vibrancy of our society by enabling the global flow of goods, ideas, capital and people through our shores.
  2. C14. COVID-19 disrupted our physical connectivity but accelerated the rise of the virtual and knowledge economy.
  3. C15. To emerge stronger, we must deepen Singapore’s position as a Global-Asia node.
    1. a. We will restore our physical connectivity and transform our aviation sector for recovery.
    2. b. We will also expand our digital connectivity and deepen our capacity to collaborate and innovate with partners around the world.
  4. Positioning our Aviation Sector for Recovery

  5. C16. Travel and connectivity have taken a severe hit due to COVID-19, and recovery may be prolonged.
    1. a. In particular, COVID-19 has reshuffled the global web of connectivity, and changed the aviation landscape.
    2. b. Airports will be differentiated by their capabilities in securing public health and enabling safe travel. They will need digitalised systems and the ability to effectively re-route people and goods.
  6. C17. To secure our position as a key aviation hub and maintain Changi’s position as a safe, trusted, and well-connected airport for travellers and employees alike, we will restore Changi’s connectivity and invest in on-arrival testing and biosafety systems.
    1. a. This includes the Notarise and Verify system being developed by GovTech through public-private partnerships. For instance, GovTech is working with local startup Affinidi, on a software that can quickly verify the authenticity of digital COVID-19 test result certificates and vaccination records. (See Annex C-4.)
  7. Creating Platforms for Nurturing Creative Ideas

  8. C18. Beyond physical connectivity, the post-COVID-19 economy will see two key shifts:
    1. a. First, a shift from physical to digital modes of transactions across geographical borders.
    2. b. Second, a shift from tangible to intangible assets in value creation. Such intangible assets include the knowledge, networks and data that businesses can use to create new technologies and innovations.
  9. C19. To remain competitive, businesses will need to innovate and collaborate on a global scale.
  10. C20. To support our businesses, I will invest in three key platforms.
    1. a. The first platform is the Corporate Venture Launchpad, which will be piloted this year to drive new innovative ventures. This Launchpad will provide co-funding for corporates to build new ventures through pre-qualified venture studios. This is especially useful for larger businesses which want to rekindle a startup mindset within their organisations.
    2. b. One such venture studio which I visited recently is BCG Digital Ventures. They collaborated with Olam, a Singapore food and agricultural multinational to build Jiva, a farmer services platform. This platform will help farmers in developing countries to increase crop yield, access credit, and connect directly to buyers. This venture helps meet the rising global food demand, while uplifting the income of farmers. (See Annex C-4.)
    3. c. The second platform is the Open Innovation Platform, or OIP.
      1. i. The OIP facilitates the matching of problems faced by companies and public agencies, with solution providers, and co-funds prototyping and deployment.
      2. ii. For example, through the platform, the Building and Construction Authority, was matched with three solution providers, TraceSafe, TagBox and Nervotec, to develop solutions for safe re-opening of worksites. The firms developed real-time systems that helped construction site owners conduct contact tracing and health monitoring of their workers.
      3. iii. I will enhance the OIP with new features such as a cloud-based Digital Bench for accelerated virtual prototyping and testing. (See Annex C-1.)
    4. d. The third platform I will enhance is the Global Innovation Alliance, or GIA.
      1. i. The GIA serves to catalyse cross-border collaboration between Singapore and major innovation hubs globally.
      2. ii. Since its inception in 2017, over 650 students and about 780 Singapore businesses have taken part in innovation launchpads overseas. 40% of these were in Southeast Asia.
      3. iii. Last year, despite the pandemic, there were over 100 potential business matches between Indonesian and Singapore-based companies.
      4. iv. WaveScan, a Singapore startup specialising in sensor technology, tapped on GIA and formed a partnership with A.L.I. Technologies, a company in Japan specialising in unmanned miniature aircrafts. WaveScan also attracted investments from Leave a Nest, a GIA operating partner in Tokyo. (See Annex C-4.)
      5. v. The GIA network currently has 15 city links, including four Southeast Asian cities – Bangkok, Ho Chi Minh City, Jakarta, and Manila. I will expand it to more than 25 cities around the globe over the next five years.
      6. vi. The GIA will also be enhanced through the inclusion of the Co-Innovation Programme. The Programme will support up to 70% of qualifying costs for cross-border innovation and partnership projects.
        1. 1. In 2019, 31 Singapore companies were supported for projects with enterprises from 11 partner countries.
        2. 2. One of them, Xnergy, is a local deep-tech startup with expertise in contactless charging. Through the Co-Innovation Programme, Xnergy partnered with Balyo, a French multinational, to co-develop contactless charging systems for forklifts. (See Annex C-4.)
  11. C21. As businesses innovate, they will create intellectual property and intangible assets, or IP and IA. They will need to identify and protect, value and manage, and commercialise these. To support businesses in commercialising the fruits of their innovation, we are developing the Singapore Intellectual Property Strategy 2030. This will include equipping businesses with tools to value their IP and IA, and training skilled professionals in these fields. The Intellectual Property Office of Singapore will announce the details on World IP Day in April.
  12. Deepening our Global and Southeast Asia Partnerships

  13. C22. Strong connectivity enables our businesses to plug into global and regional supply chains and industry clusters, and deepen our innovation partnerships.
  14. C23. We are stepping this up with ASEAN nations.
    1. a. The ASEAN nations had a GDP of US$3.2 trillion collectively in 2019, making it the world’s fifth largest economy. The ASEAN region also became China’s largest trading partner in 2020. There is significant growth potential in this region, with favourable demographics for the next two decades.
    2. b. Last December, ESG, IMDA and EDB launched the inaugural Southeast Asia Open Innovation Challenge which saw participation from Indonesian, Malaysian, Thai, and Vietnamese corporates.
    3. c. To add on to these efforts, the Singapore Business Federation will be officially opening two new overseas offices soon – one in Jakarta and one in Ho Chi Minh City.
    4. d. We have also launched cross-border projects through ASEAN platforms. One such project is the YCH Vinh Phuc Inland Container Depot Logistics Centre that was launched last November. This is a joint landmark SuperPort project between Singapore-based YCH Group and T&T Group, a Vietnamese conglomerate.
  15. C24. To promote the integration of ASEAN markets, we are pursuing common frameworks in emerging areas. For instance, ASEAN nations have developed the ASEAN Payment Policy Framework to encourage retail payment linkages between ASEAN countries.
  16. C25. We will continue to work closely with our ASEAN members, to enhance digital connectivity and cybersecurity, and to get ready for the Fourth Industrial Revolution, building on initiatives such as the ASEAN Smart Cities Network.
  17. C26. We will also continue to enhance our infrastructure investments in the region.
    1. a. The Kendal Industrial Park was a joint investment between Singapore’s Sembcorp and Indonesia’s PT Jababeka to build up activities in food processing, building materials, and medical equipment manufacturing, amongst other sectors.
    2. b. In my Statement in October last year, I also announced our intent to enhance cooperation with our most immediate neighbours, through Iskandar Malaysia in Johor, and the islands of Batam, Bintan, and Karimun in the Riau Islands.
    3. c. One of the goals is to build up a cluster of industries around the electronics, medtech, food manufacturing and processing sectors, as these see rising demand in ASEAN nations.
    4. d. The recently launched Southeast Asia Manufacturing Alliance will support these efforts. It serves to promote a network of industrial parks to manufacturers interested to invest in both Singapore and the region, and connect local firms with these manufacturers.
    5. e. On the digital front, we are working with our Indonesian partners to build the Nongsa Digital Park to facilitate collaboration between Singaporean companies and tech talent in Indonesia.
    6. f. As Singapore, Malaysia and Indonesia grow together, benefits will also be reaped by the wider Southeast Asia region.
  18. C27. To summarise, the first enabler is to grow a vibrant business community, with a strong spirit of innovation and enterprise, deeply connected with the ASEAN region, Asia and the world.

Suite of Capital Tools to Co-Fund Transformation

  1. C28. The second enabler is to catalyse a wide range of capital to co-fund and enable businesses, from startups to small, medium, and large enterprises, to innovate, transform, and scale.
  2. C29. Businesses have had to preserve cash flows during these uncertain times. Yet, it is precisely during these extraordinary times, that those that are ready to seize new opportunities will emerge stronger.
  3. C30. To catalyse the flow of capital and bridge market gaps, the Government will step up risk-sharing arrangements with providers of capital, and provide grants, to support businesses at various stages of growth.
  4. Venture Debt for High-Growth Enterprises

  5. C31. First, for high-growth enterprises, including startups.
  6. C32. I will ensure that they continue to have access to financial capital, by extending and enhancing the Enterprise Financing Scheme - Venture Debt programme.
    1. a. From 2016 to 2019, we have seen an annualised growth rate of 44% in the amount of early-stage funds raised for promising enterprises.
    2. b. Our ecosystem of budding entrepreneurs and venture funds is growing.
    3. c. As part of the Venture Debt programme, the Government shares up to 70% of the risk on eligible loans with Participating Financial Institutions.
    4. d. I will continue to support this programme, and increase the cap on loan quantum supported, from $5 million to $8 million.
    5. e. With this, we expect about $45 million of venture debt to be catalysed over the next year.
  7. Co-Funding Transformation of Mature Enterprises

  8. C33. Second, more mature enterprises, from micro and small, to medium and large enterprises, should also invest in new and emerging technologies to sharpen their competitiveness.
  9. C34. To encourage them to do so, the Government will co-fund their adoption of digital solutions and new technologies.
    1. a. The new Emerging Technology Programme will co-fund the costs of trials and adoption of frontier technologies like 5G, artificial intelligence and trust technologies. This will support commercialisation of innovations and diffusion of technology downstream.
    2. b. To help firms to identify and adopt digital solutions, the Chief Technology Officer, or CTO-as-a-Service initiative will provide access to professional IT consultancies.
    3. c. The new Digital Leaders Programme will also support promising firms in hiring a core digital team and in developing and implementing digital transformation roadmaps.
    4. d. Beyond these new initiatives, I will also extend the enhanced support levels of up to 80% for existing enterprise schemes such as the Scale-up SG programme, Productivity Solutions Grant, Market Readiness Assistance Grant, and Enterprise Development Grant, to end-March 2022.
    5. e. Including these enhancements, I am setting aside $1 billion for these schemes. (See Annex C-1.)
  10. C35. In the coming years, a critical part of business transformation will be in job redesign. With technological advances, many tasks that are physically demanding or repetitive can be better done by machines. With an ageing workforce, we must leverage technology to develop senior-friendly workplaces.
    1. a. An example is a household name, Tim Ho Wan. Working with NTUC’s e2i, it modernised what was previously tedious manual ordering, tabulation and reporting, saving 20-30% in man-hours. To ensure productivity gains are shared with employees, e2i also negotiated with the company to increase the salary of the impacted older staff. (See Annex C-4.)
    2. b. To support businesses in redesigning jobs, I will enhance the Productivity Solutions Grant – Job Redesign, by raising the Government co-funding ratio from 70% to 80%, till end-March 2022.
  11. Equity Investments in Large Local Enterprises

  12. C36. To support the growth of local companies, the Government has partnered equity firms to provide growth capital for companies to transform and scale.
    1. a. Thus far, we have largely focused our efforts on small and medium enterprises, or SMEs, with annual revenues of up to $100 million. Companies of this scale traditionally lack attention from private equity players, while larger enterprises tend to have the means to raise capital.
    2. b. However, changes in the global economic landscape and financial markets have made it harder for our large local enterprises, or LLEs to attract private equity. This may mean missed opportunities for companies with strong fundamentals to plug into new areas, as supply chains are reconfigured.
  13. C37. Our LLEs have good fundamentals. Over the years, many have expanded overseas, projecting the Singapore brand as a trusted and reliable partner.
  14. C38. To ensure growth capital is available for LLEs that are ready to transform or expand overseas on a larger scale, I will complement existing grants and loans, and support them through equity investments, tapping on market players to ensure commercial discipline.
    1. a. I will set aside $500 million to be co-invested with Temasek in a Local Enterprises Funding Platform, to be managed commercially.
      1. i. Temasek will match the Government’s funds on a one-for-one basis, so the platform will have $1 billion available for its investments.
      2. ii. The platform will invest in non-control equity and mezzanine debt of selected LLEs, which are willing to work with the fund manager to pursue their next phases of growth.
      3. iii. Temasek will bring its strong commercial discipline to this partnership.
      4. iv. The Ministry of Trade and Industry will provide more details on the Fund later.
  15. Transformation of Value Chains – Growth and Transformation Scheme

  16. C39. I have touched on our support for companies – from high-growth to more mature enterprises, from SMEs to Large Local Enterprises.
  17. C40. The company is the basic economic unit. Each company’s transformation is necessary. But we can reap the full benefits of transformation, when we transform the entire value chain.
  18. C41. So for the next phase of our industry transformation, I will focus on the transformation of entire value chains – where each player in the chain works together to integrate and digitalise processes, and upskill their workers. We will build on the Alliances for Action, and begin with a few alliances first. We will start with the Built Environment sector, where I will launch the Growth and Transformation Scheme, or GTS.
  19. C42. Since the launch of the Construction Industry Transformation Map in 2017, the Government has made a big push to drive transformation in the Built Environment sector. Firms have adopted new ways of doing things, such as Design for Manufacturing and Assembly, or DfMA, and Building Information Modelling. Adoption for DfMA technologies has doubled from 19% in 2017 to 39% in 2020. But it can be much better.
  20. C43. This sector has just experienced an existential threat last year, and is recovering. Developers, consultants and contractors now realise the urgency to radically improve productivity and reduce the reliance on labour-intensive methods.
  21. C44. The GTS for the Built Environment sector will require developers to work closely with their consultants, contractors and suppliers to level up as an ecosystem or value chain. Working together to transform and innovate, the alliance members can achieve more than what each alone can do.
  22. C45. So, while we continue support the sector’s recovery, we will tilt our support to enable it to transform decisively. Our resolve in achieving transformation of the industry, and in fact of all industries, is clear and unwavering.
  23. C46. The Minister for National Development will elaborate on this at the COS.

Skilled Human Capital and Talent

  1. C47. I have touched on the first two enablers in our next phase of transformation – to grow a vibrant and connected business sector with a strong spirit of enterprise, and to catalyse a suite of capital tools. Let me now focus on the third enabler – to develop the skills, talents, and creativity of our people.
  2. C48. Enabling our people to have access to good jobs and job opportunities is the purpose, for developing a strong economy. A vibrant economy creates the jobs and opportunities for our people to be at their best.
  3. C49. The employment landscape is undergoing fundamental changes, and COVID-19 will accelerate these changes.
    1. a. A digital, innovation-driven economy means that businesses will need highly-skilled workers and deep talent. Our people will need to have both broader and deeper skills and creativity.
    2. b. The workplace is changing. COVID-19 has forced us to work from home and adopt new ways of collaborating with others.
      1. i. A Mercer survey last year showed that over 90% of employers globally saw similar or higher productivity despite employees working remotely. Over 80% of firms intend to implement more flexible working policies. These are global trends that our people will have to adapt to.
      2. ii. ‘Working from Home’ is just a short step to ‘Working from Anywhere’. Yes, anywhere in the world – as long as you have a computer and an internet connection. Singaporeans may find more opportunities as the best firms source globally, but will also face stiffer competition from talents who may not even step foot in Singapore.
  4. C50. But Singaporeans should not be fearful. There are many strengths in Singapore that will enable us to create good jobs here. But to access these, we have to learn and adapt.
    1. a. I met Mr Edmund Tang last September, when he was at the e2i Trade and Connectivity Career Fair looking for a job. He had been working on autonomous vehicles but decided to explore if his skills could be better deployed. An e2i career coach matched him with a job opening. Today, he is a Senior Business Development Manager in the Advanced Remanufacturing and Technology Centre, an A*STAR Research Institute. In his new role, he is able to build on his experience to develop new skills in a new area. (See Annex C-4.)
  5. SGUnited Jobs and Skills Package

  6. C51. The SGUnited Jobs and Skills Package is a key pillar in our industry transformation, to enable Singaporeans to learn and thrive, as our jobs and workplace change, and as businesses transform.
    1. a. It was first launched last year, to tackle the anticipated labour market fallout from COVID-19.
    2. b. As of end last year, we have placed nearly 76,000 individuals into jobs, traineeships, attachments, and skills training. Under the Jobs Growth Incentive, or JGI, an estimated 110,000 local jobseekers were collectively hired within two months from the implementation of the scheme.
    3. c. Looking ahead, as companies and industries transform, and new growth areas emerge, our people will need to have the skills and agility to move. To emerge stronger, our people will need new knowledge and skills.
    4. d. To enable our people to take on these new jobs, I will allocate an additional $5.4 billion to a second tranche of the Jobs and Skills Package, on top of the $3 billion allocated last year.
    5. e. Of this, $5.2 billion will be allocated to JGI, to extend the hiring window by seven months, up to end-September 2021.
      1. i. Companies hiring eligible locals will be given up to 12 months of wage support from the month of hire.
      2. ii. However, those hiring mature workers, persons with disabilities, and ex-offenders will be given more support – up to 18 months of enhanced wage support. (See Annex C-2.)
    6. f. For workers who require additional support before landing a job, we will also extend the support for the SGUnited Skills, SGUnited Traineeships, and the SGUnited Mid-Career Pathways Programmes. (See Annex C-2.)
  7. C52. Through the next phase of the SGUnited Jobs and Skills Package, we have set aside the budget to support the hiring of 200,000 locals this year through the JGI, and provide up to 35,000 traineeship and training opportunities to continue to support jobseekers in upskilling and accessing employment opportunities.
  8. Innovation & Enterprise Fellowship Programme

  9. C53. As we head into a more technologically-intensive and innovation-driven economy, we must also groom leaders in innovation and enterprise, especially in deep technology areas.
  10. C54. The NRF will be supporting about 500 Fellowships under the new Innovation and Enterprise Fellowship Programme, or IFP, over the next five years, to meet needs in areas such as cybersecurity, artificial intelligence and health tech. It will work with a range of partners, including accelerators, venture capital firms and deep tech startups.
    1. a. The first partner, SGInnovate, recently launched PowerX Robotics, the first programme under IFP, to develop local talent for the fast-growing robotics and automation sector. Trainees undergo a nine-month programme to learn and apply robotics-related skills on real-world projects, and are thereafter placed with their respective host companies to drive innovation.
    2. b. The inaugural programme has 10 trainees in six host companies. One of the trainees, Mr Cheng Yi Chiao, previously worked in various MNCs and startups overseas. He returned to Singapore and was emplaced in an agri-tech startup, Polybee. Working together with Polybee's team, Mr Cheng has learnt in a very short time how automation of pollination with micro drones works. These efforts are in line with the enhancement of food security in Singapore with deep tech (See Annex C-4.)
    3. c. The host companies have welcomed this initiative to build up tech talent in Singapore.
  11. Enhancing the Salaries of Healthcare Workers

  12. C55. Next, I will touch on the healthcare sector.
  13. C56. Our healthcare workers have, over the years, been working hard to provide us with the highest quality of care. Since COVID-19 hit, their exemplary commitment has shone through. Once again, let me express our deepest appreciation to all healthcare workers for your dedication in fighting the pandemic.
  14. C57. Beyond the pandemic, the healthcare sector is set to grow, as our people age. This sector provides many good skilled jobs that are noble, meaningful, and make a difference to Singaporeans.
  15. C58. We will enhance the salaries of our nurses and other healthcare workers such as support care staff. This will apply to workers across public healthcare institutions, and publicly-funded community hospitals and long-term care service providers.
    1. a. The Minister for Health will announce the details at the COS.
  16. Managing the Local-Foreign Worker Mix Alongside Industry Transformation

  17. C59. I will now turn to manpower issues.
  18. C60. Some Singaporeans are concerned about our reliance on, and competition from, foreign manpower. At the same time, many businesses and trade associations have said that it is difficult to hire locals, and asked for us not to tighten foreign worker quotas further, to remain globally competitive.
  19. C61. The way forward is neither to have few or no foreign workers, nor to have a big inflow. We have to accept what this little island can accommodate. To strike a balance, we must focus on enhancing the complementarity of local and foreign manpower, and step up on industry transformation. In line with this, I will support the employment of Singaporeans while we deepen their capabilities and promote capability transfer, while moderating our reliance on foreign labour where we must.
  20. C62. I will provide further help to support wage increments for companies to retain or draw in locals by extending the Wage Credit Scheme for a year, at a co-funding level of 15%. I urge employers to make use of this and other schemes to redesign jobs and upskill their local staff.
  21. C63. For sectors, especially those in new growth areas, where we may be short of skills, we welcome expatriates with the right expertise to complement Singaporeans, and help us build capabilities. This will allow us to add vibrancy to our local market, better serve international and regional markets, and enhance Singapore’s attractiveness to global investors.
    1. a. The Capability Transfer Programme, or CTP, is one of many programmes that supports such foreign-to-local skills transfer. As of end-2020, more than 140 companies, and over 970 locals have benefitted or are expected to benefit from 40 projects.
    2. b. I will extend the CTP up to end-September 2024.
    3. c. One Singaporean who has benefited from the CTP is Mr Mohamad Zaini Bin Selamat. He is a Technical Officer at SP Group who learnt skills from foreign experts in network support for the rollout of advanced electricity meters. He is now performing higher-value work such as fault isolation and data analysis, and supervising junior colleagues. (See Annex C-4.)
  22. C64. To complement our local workforce, we also have the S Pass for companies to hire workers with the technical expertise. I had indicated at the Unity Budget in February 2020, that the Manufacturing S Pass Sub-Dependency Ratio Ceiling, or sub-DRC, would be cut when conditions allow.
    1. a. Manufacturing is a significant pillar of our economy.
    2. b. To achieve our vision of being a global advanced manufacturing hub, firms must make it a priority to develop a strong, highly-skilled local core in their workforce.
    3. c. At the same time, we cannot do without foreign workers, especially those with deep skills. But we should moderate further our reliance on them, and focus on creating good jobs for locals.
    4. d. Therefore, we will reduce the sub-DRC for Manufacturing in two steps, to 18% from 1 January 2022, and to 15% from 1 January 2023. (See Annex C-3.)
    5. e. This is in line with the tightening already underway in other sectors such as the Services, Construction, and Marine Shipyard and Process sectors.
    6. f. The move has been carefully calibrated, so that firms have one year to adjust, before changes are implemented.
  23. C65. We will continue to review our S Pass framework, including the qualifying salary and levies, to ensure we maintain complementarity between the local and foreign workforces.